Rational Survivability

This will be short and sweet.  Citrix’s announcement that they will clip a swell $500 Million to acquire XenSource on the tail of VMware’s IPO makes nothing but sense.  The timing is interesting; waiting for VMware’s IPO both validated the move but one has to wonder if it jacked the price any.

I can’t wait to see how this maps out over time across Citrix’s product lines which are still fairly siloed at this point.  Leveraging XenSource’s technology is a force multiplier across many elements of their offerings. It’s clear what the first moves will be, but I’m really interested in the longer term play.

At any rate, this is a fantastic strategic move for Citrix; these guys are poised to continue their march to take on Cisco as they become a robust platform for application and content delivery.*   If you take a look at their M&A activity over the last few years, it’s on a direct collision course with Cisco in many vectors. 

The big difference is, you can bolt their solution on instead of having to bake it in and these guys already have a footprint and expertise in the server and client consolidation markets.

Orthogonally, I wonder what effect this might have on f5?  Any thoughts there?

Then there’s Microsoft.  This may be a huge opportunity for other players such as SWsoft  to reinforce defensive positioning by shoring up relationships that otherwise might have gone XS’s way.

It’s going to get messy boys and girls.

This acquisition certainly has its challenges, but it really positions Citrix with as a complement to their existing product offerings.

/Hoff

*It gets more interesting strategically from a defensive position given Cisco’s recent investment of $150M in VMware prior to their IPO and my commentary on the matter here.